MPS announced the extension of its share offer period until Wednesday for retail investors, and Thursday for institutional investors, after repeatedly failing to find €5bn (around £4.2bn) in funding to help recapitalise the bank.

Retail investors in Italy will be able to purchase 35 per cent of the shares, while the other 65 per cent will be reserved for institutional investors from around the world.

The shares will be limited to a maximum of €24.90, after the bank closed over the weekend at €20.93 on the Borsa Italiana.

If the bank does not find a private-sector buyer the Italian government may be forced to step in to protect bondholders. EU rules technically forbid bailouts without investors taking a hit, but the Italian government is keen to avoid heavy losses for thousands of retail investors.

The existence of the world’s oldest bank has been threatened over the last few months, as it continues to struggle under the burden of a large book of non-performing loans (NPLs) – loans where the debtor has missed a repayment in the last 90 days.